Post

Commodities that Outpaced 1970s Inflation.

In Investment Returns on April 26, 2011 by CQCA

The chart above shows the “Minor League” of commodities that outpaced the money supply during the 1970s. If the increase in the price of potash was subtracted by the increase in the money supply, the real gain would have been 1.87% over the decade. That is an annualized return (equation: 1.0187^.1 = ?) of .185% per year. Platinum increased 31.52% in real terms, which is a respectable real annualized return of 2.77% over the period.

The chart above shows the “Major League” of commodities that outpaced the money supply during the 1970s. The price of indium increased 244.98% in real terms (the nominal price subtracted by the increase in M3). This is an annualized rate 13.18% every year over the period.

These results show that certain commodities are very good investments during inflationary times.

Comments Off on Commodities that Outpaced 1970s Inflation.